HCI Group launched a pilot project for three digital tokenized reinsurance securities priced from $11.10 per token. The securities mirror returns of specific participations by its Fortex Re subsidiary in HCI's catastrophe excess-of-loss reinsurance programs. The pilot aims to expand investor access to catastrophe risk as an asset class through lower minimum investments and shorter duration.
HCI Group launched three digital tokenized reinsurance securities priced from $11.10, mirroring returns of its catastrophe excess-of-loss reinsurance programs.
"We are pioneering a new method of risk transfer by connecting the reinsurance market with new sources of capital," Paresh Patel, HCI's Chairman and Chief Executive Officer, said.
The three series — A at $11.10, B at $22.12 and C at $30.01 per token — offer estimated redemption values of $36.00, $49.00 and $35.20, respectively, assuming no catastrophe losses. The securities align with the annual reinsurance treaty cycle, offering a shorter investment horizon than traditional catastrophe bonds. Minimum investment is $5,000 for qualified U.S. accredited investors under Rule 506(c) of Regulation D and qualified non-U.S. investors under Regulation S.
The pilot expands investor access to catastrophe risk as an asset class through tokenization, lowering barriers that have historically limited participation to institutional investors. The securities are issued by SurancePlus, a subsidiary of Oxbridge Re Holdings (NASDAQ: OXBR), which reported annualized returns of 29.3% and 43.4% on its 2025-2026 tokenized reinsurance offerings, exceeding original targets of 20% and 42%, respectively.
The tokens synthetically mirror specific participations by HCI's Cayman Islands-based reinsurance subsidiary, Fortex Reinsurance SPC, in the company's 2026-2027 catastrophe excess-of-loss reinsurance programs. Each token carries a distinct risk-return profile, allowing investors to tailor exposure through individual purchases or combined allocations. The securities have no impact on Fortex Re's or HCI's underlying reinsurance programs.
The pilot represents a step toward broadening the investor base for insurance-linked securities, an asset class that has traditionally required minimum commitments of $1 million or more. HCI said it is exploring tokenization as a way to lower investment barriers, shorten investment duration and create potential for increased liquidity. Investors will watch uptake of the three series and whether HCI expands the program beyond the pilot phase. Catastrophe losses on the underlying reinsurance contracts could result in a loss of some or all of the value of the securities, the company said in its forward-looking statements.
This article is for informational purposes only and does not constitute investment advice.
